So, the UK is undergoing 10% cutback in government spending, but expected to loan 4.2 billion to Portugal. It is unlikely Portugal will pay it back, because they can't right now. Spain is coming up. The U.S. is struggling between complete financial irresponsibility and austerity, and settling for 1% reductiona that will satisfy no one.

I've watched this sovereign debt crisis unfold, and the sad part is that Eric Fry is right. It's unfolding in pretty much the same way as the mortgage backed security crisis. It has finally arrived at the point where the rest of the world is watching to see if the U.S. Government can control its' spending. If it can't, interest rates will climb no matter what the Bernanke and Geithner try to do.

The amazing part about it is how little attention the world outside of finance and politics is paying to it.

http://dailyreckoning.com/the-return-of-the-sovereign-debt-crisis/

http://news.bbc.co.uk/today/hi/today/newsid_9451000/9451025.stm